Federal Stafford Loan
Federal Subsidized and Unsubsidized Loans
Federal Family Educational Loan (FFEL) Stafford Loans are either subsidized or unsubsidized. The subsidized FFEL Stafford Loan has a low and variable interest rate, and is need-based. The federal government pays the interest on the loan during: (1) your enrollment in school on at least a half time basis, (2) a six-month grace period immediately following your separation from school, and (3) a deferment, which is a temporary, authorized time when your payments may be postponed.
The unsubsidized FFEL Stafford Loan, which also has a low and variable interest rate, is non-need-based. "Unsubsidized" means the federal government does not pay the interest to your lender on your behalf. You are responsible for paying all interest on the loan. Interest is charged beginning the day the loan is paid to you until the day the loan is repaid in full. You may choose either to pay the accumulating interest while you are in school, during the grace period for the principal, and during a deferment of the principal or to have the unpaid, accumulating interest capitalized, i.e., added to the principal balance of the loan. Note: If your loan interest is capitalized, it will increase the amount you have to repay.
Annual Loan Amount and Aggregate Limit
The amount in FFEL Stafford Loan funds that you are eligible to borrow annually is limited by (1) your grade level (2) whether you are a dependent or an independent student, (3) your financial need, and (4) your cost of attendance. You cannot borrow more than your financial need or the cost of attendance (your budget) at WSU.
Dependent Undergraduate Student Loan Limits
1st year: $3,500, subsidized + unsubsidized
2nd year: $4,500, subsidized + unsubsidized
3rd & 4th years: $5,500, subsidized + unsubsidized
Maximum total at the undergraduate level: $23,000
Independent Undergraduate Student Loan Limits
1st year: $7,500, no more than $3,500 of which may be in subsidized loans
2nd year: $8,500, no more than $4,500 of which may be in subsidized loans
3rd & 4th years: $10,500, no more than $5,500 of which may be in subsidized loans
Maximum total at the undergraduate level: $46,000, no more than $23,000 of which may be in subsidized loans.
Graduate and Professional Student Loan Limits
$20,500 annually, no more than $8,500 which may be in subsidized loans.
Maximum total at the graduate or professional level, including loans received for undergraduate study: $138,500, no more than $65,500 of which may be in subsidized loans. Note: Medical students may borrow additional funds.
Loan Interest Rate
Interest Rate Reductions
Over a four-year period beginning July 1, 2008, the interest rate on subsidized Stafford Loans made to undergraduate students will be reduced. The applicable interest rates for loans made during this period are as follows:
| First disbursement of a loan: Interest rate on the unpaid balance |
Interest rate on the unpaid balance |
|
| Made on or after | And made before | |
| July 1, 2008 | July 1, 2009 | 6.0 percent |
| July 1, 2009 | July 1, 2010 | 5.6 percent |
| July 1, 2010 | July 1, 2011 | 4.5 percent |
| July 1, 2011 | July 1, 2012 | 3.4 percent |
These changes apply to subsidized Stafford loans first disbursed on or after July 1 of each year through June 30 of the next year. This change does not affect any prior loans made to borrowers; the terms and interest rates of those loans remain the same. These reduced interest rates apply only to subsidized loans; any unsubsidized Stafford Loan for the same undergraduate borrower would continue to be made at the current fixed interest rate of 6.8 percent.